Skip to main content

Posts

Showing posts from February, 2015

Identifying Horse Racing Space Aliens

As you know by now, everyone is talking about colors of a dress. The dress, which is blue and black, has spawned a weird cult of white and gold people. Last evening on the twitter, when I posted the color and saw the responses, I began to realize, that there was something wrong.

After analyzing the white/gold, blue/black data the best I could, I believe, and posted, fervently, that I think the white and gold people are space aliens.

It's really the only logical explanation.

After that - maybe the aliens got a memo from the mother ship - fewer and fewer people were willing to tweet or post they saw white and gold. So, today, it is much harder to tell who is space alien or not. Space aliens, as we all know, are very smart.

Now, here on the blog we are not going to solve these space alien issues. Some are friends so I hope they are not exported; even if they have to live in camps with leg monitors, at least they are around and we can visit. But, regardless, I'll let smart people…

We Can Handle the Truth

Jack Nicholson was wrong. Racing can handle the truth, because the truth allows us to do the right things, rather than the wrong things. And it's a way forward.

Churchill Downs net income dropped 16% last year. Which is due to many factors. Most important to horseplayers in 2014 was the takeout hike, which decreased payoffs whenever you cashed a ticket. That spurred a pretty stout backlash. At the time, everyone and everyone's grandmother believed that Derby Day revenue would rise; which was pretty simple logic. It was the other part of the meet that was in trouble, handle wise. That turned out to be true:

The problem is, narratives about "field size" and other items muddy the truth, and that's where racing gets in trouble.

A takeout hike will hurt handle; you know that and I know that. But when the message gets muddied, the business glosses over it with other factors - weather, the Olympics in Vancouver, the economy, losing a half a horse in field size. No one wa…

Mass Market

A post that I vehemently agree with was made on Godin's blog this week. "Mass Market" is a concept we've spoken about a lot here, so I guess that agreement is not shocking to anyone. But it's nice to see a talented writer talk about it, rather than me, your not-so-talented host. 
 When someone wants to know how big you can make (your audience, your market share, your volume), it might be worth pointing out that it's better to be important, to be in sync, to be the one that's hard to be replaced. And the only way to be important is to be relevant, focused and specific. Horse racing's main edge in the marketplace has not come from television, or mass market appeal. In fact, television has supplied racing with very little reach, and mass market appeal for its product is virtually non existent outside Triple Crown days.

What has kept it afloat is the fact it has stayed 'relevant, focused and specific' - not because of a marketing plan - but ma…

The Gulfstream DQ's & Non DQ's Were (Unfortunately) Consistent

You probably watched the races from Gulfstream on Saturday. Although the headlines were dominated by the Fountain of Youth disqualification of Upstart, there were two other stewards decisions on the same card. Mike Watchmaker made some proclamations about those decisions.
Let me repeat because incredibly some don't get the connection. If you leave up House Rules, D. Dynaformer, you have to leave up Upstart.
— Mike Watchmaker (@DRFWatchmaker) February 23, 2015 Earlier on, he wrote that "consistency was needed for the GP stewards".

I understand where Mike is coming from, and I bet you do too, but I think there's a problem with that.  The three rulings were not the same infractions; they were three separate, different racing incidents, which exemplify how difficult the sport is to judge consistently. And if we look at the facts, I don't think they were judged inconsistently at all.

In race 4 you had a horse on the outside, who looked like a pretty clear winner…

The Curious Case of Horse Racing Television

This past week everyone began to digest the merger of TVG and HRTV. Instead of two separate channels on two US cable systems, there will be two channels on one. There are proclamations this is good for the sport, bad for the sport, or indifferent for the sport.

TV and racing is a very curious marriage. Racing on television is not football, or hockey or baseball. Those leagues sign deals with networks, and some of them run into the billions of dollars. In a quid pro quo, the network gets viewers, sells advertising, and the leagues get revenue and exposure.

Racing on the other hand - barring the Triple Crown races - pays networks to show their races. It's not because racing is too small, because rodeo, pro bowling, the WSOP and countless other small sports with only a few hundred thousand viewers or fewer, get paid for programming. It's just because racing is a gambling game, and having to show the product to everyone at all times, is a staple for the main revenue driver of the…

In Racing, Simple is Too Simple

An Op/Ed in the TDN today looked at simple being too simple when it comes to revenue splits in horse racing. Revenue splits can't really be changed and be accretive, in the truest sense of the word. If you have a pie in an 8 inch pie plate, you can't cut the slices differently and make it a 12 inch pie. But massaging them in certain ways, creatively, can make things run smoother.

Some people make this argument very simplistic but it's anything but.

Let's take this recently tweeted out story by Rich Eng "Plug Pulled on Feed From Some Racetracks" where the author explains that in Vegas there is a negotiation going on between Monarch and them to show content. Monarch, whose head recently said ""The days of the buyer importing the signal cheap and keeping most of the revenue (from wagering) are probably coming to an end", is playing hardball with Mid-Atlantic tracks trying to extract more of a fee. In Vegas, this is not happening.

"Daruty said…

Interstate Horse Racing Act Chatter Always Fails Customers

I spent some time reading the dissertation about the IHA on Chuck Hayward's site today, written by lawyer Joel Turner.

The piece is not unlike many we've read before. It's about getting more money from the existing wagering pie, for, in this case, horse owners.

It begins by speaking about off track handle, which has gone up, while higher margin on track handle, has fallen. Because of that, more taxes, more fees, more regulation is needed to cure that so-called ill.

The problem is, and this is always the problem, all of those things hurt handle. Take this case in point from the article.
The migration of handle to simulcasting and ADWs has left on-track wagering a virtually meaningless part of the pari-mutuel landscape. Even at racing's most well-attended event last year, the Kentucky Derby, the 164,906 patrons at Churchill Downs wagered $23.4 million on track, just 13 percent of the total handle of $180.7 million. Think about that for a second. If I told you that…

TVG Takeover Comments Show Racing's TV Dilemma

TVG and HRTV are set to merge. This probably makes perfect sense, and will likely help TVG (which still has money to invest with through parent Betfair) in the long run.

What fascinates me most, are some of the comments at the above link about this merger. It's a snapshot of just how difficult it is for this sport to deal with itself.

"I really hope that HRTV doesn't lose the excellent coverage of other "horse sports" that it currently features. As someone involved in many aspects of the horse world, I love the show jumping, dressage, and training coverage"

"All this means is more "stretch" calls and more on air talent picks and I couldn't give a flying crap what Todd, or Simon, or Paul like."

"Showing of races and parades should be "real time" as their primary priority."

"For one, I hope HRTV continues it's type coverage. Less talk more races..TVG talks to much and ignores many races so they can all…

That Pesky Tradition

Being first in a prospects mind is marketing 101. Not far behind, in my opinion (and the opinion of people with more degrees than me; the type who write books), is that being who you are and not wavering from it, is a prime goal for any business.

Sid posted this today:

Camden Yards on a wintry day. pic.twitter.com/KYHkvW7sxx
— Sid Fernando + Obser (@sidfernando) February 16, 2015 You don't have to be a Ken Burns fan to know baseball is a lot like that picture.

Yes, that's a newer park, but it sure looks old.

I remember being at the SkyDome, for I think, the third game ever played there. It started to rain, and the roof closed. Wow, that was exciting; at the time anyway. That excitement wore off pretty quickly, because it was not a baseball park. Roofs closing in a cavernous, big screen, dual purpose, impersonal baseball park only goes so far.

Horse racing, like baseball has tradition. It's as old as the day is long. It's about watching equine athletes and rememberin…

Horse Racing's Super-Strange Model

I've been racking my brain (no jokes please) and I am completely flummoxed trying to find parallels.

Horse racing in North America has, for a million years it seems, dealt in a system of revenue with a percentage of margin. If takeout is 22% and it brings in $1,000,000, the one million is not split, the 22% is. 22% is a margin, not profit, or money, but it is somehow treated as a price, or profit.

If a track wants "more money" or if a horsemen group wants "more money" or a state wants "more money", they don't ask for more money, they ask for more margin. "You get 9% of takeout but we want 11%". "Well, we charge 22% but we can raise that to 24%, would that do?"

It's the only business that I know that even remotely works like that.

If Raptors guard Kyle Lowery wants a new contract, he is not paid in a percentage of a ticket. His agent won't ask for 3.4% of ticket sales, instead of 2.9% of ticket sales.

Wal Mart's marg…

My Daily Fantasy Sports Testing Phase, ROI Thoughts, Strategy and Horse Racing Parallels

By now you’ve all heard about Daily Fantasy Sports. The business has been growing, and you can’t be a sports fan (or a racing fan) without knowing at least something about the medium. For those unaware, participants draft a one day team (in many sports’) under a salary cap, put up a few dollars (from 25 cents to many thousands) and play other teams. The takeout is between 5% and 10%, with the winners getting the rest. Over 2 billion dollars are expected to be wagered in 2015.

Although I have dabbled at Draftkings and FanDuel (both signup links from me), in November sometime I decided to study the strategy, tools and medium for a test betting phase. Is this beatable?

Since that time I have played almost 1,000 games. I have wagered $13,783.25 so far and have played College Football, the NBA, the NFL, Golf, and Hockey. CFB and the NBA I have barely played (I am not a huge fan, and know little about the players, nor am I interested to learn more), and the PGA is just starting. My $1 ROI&…

Horse Racing Needs More Vision, Fewer Monetizers

Ah, my beloved hockey. 

The "white out" is one of the best things you'll ever see at a big NHL tilt. For those who have not heard the term, it’s where upwards of 20,000 fans all come to the game dressed in home whites. It makes our TV screens look like a snowstorm. Home whites are like apple pie, an old blanket, a comfortable pillow; home whites and snowstorms for a winter sport like hockey was positive branding. Then one day that all changed. In 2003, home darks were mandated. Why? You see, the NHL saw everyone in each city buying home whites, but home darks were not sold hardly at all. By mandating this change, it made people buy more jerseys.  The white out is gone and unless the NHL rethinks this (there are petitions by fans out there), it will never return.

Most recently, we’ve seen Wall Street meet main street again in hockey. This time the NHL is moving towards advertising corporations on World Cup uniforms. The NHL, with its traditions, long history, and antifragil…

Why Horse Racing Has to Niche Market

Growing up as a kid, if I wanted to bet something, I would play a game off toss the hockey cards, target practice with a puck (most cardboard hits in the top corner after ten shots won fifty cents), or find someone to bet a football game with. It wasn't overly addictive and I sure as heck could not play it each day.

Today, it's different.

Ever wonder how Clash of Clans and Game of War can afford Super Bowl ads? Because they are worth a ton of money. 
 Clash of Clans" and "Game of War" are the highest-grossing games in both Apple's and Google's app stores. The website Think Gaming, which tracks top games, says "Clash of Clans" rakes in more than $1.6 million a day just from iPhone users. "Game of War" isn't far behind at $1.1 million daily. and my favorite quote:

"The experts we talked to said the thrill of a win keeps the cash flowing."

When you ask racing execs or horsemen reps what kind of customer they want, they w…

Comparing Super Bowls to Racing's Super Bowls- One in the same

I watched most of the Super Bowl last evening, like I am sure a few of you did. The game itself was a bit of a dud until the fireworks started in the fourth quarter, but as usual, as a spectacle, it was fun to watch.

It got me thinking. Are there parallels between the big game and racing? You bet there is.

We Hate Camera Angles

The Networks, for some strange reason, like to put a camera on the goal line in Super Bowls, when they don't use one for regular games. When you've watched eight gazillion football games, this camera angle messes with your brain. My twitter feed was not impressed, while casual fans were wondering what the big deal was.

This is tantamount to goofy camera angles in horse racing. Bettors like the pan shot, because they've been watching races that way since Thomas Edison (I think it was him; he invented everything) created the film projector. It messes with our heads and we get really cranky.

Katy Perry, Music, Lenny Kravitz

The Super Bowl halftime show h…